Our consumer expert looks at why a growing number of banks are removing
account benefits like travel insurance

Sometime before 2001, Lloyds TSB suggested I upgrade to a "Gold Service" current account which would be free if I kept a constant credit balance of £2,000 plus and which included travel insurance.

The latter attracted me as my husband and I enjoy foreign travel and are also lucky enough to holiday quite often in the UK.

Last year I received a letter from Lloyds TSB addressed to me personally. It was headed "Important changes to your Gold Account". It informed me that I was to pay a standard account fee of £12.95 a month.

PT, Cambs

I received a letter informing me that Santander intends to cancel all benefits on the Premier 50 account as from October 19 2013.

I negotiated a fresh medical upgrade with the new insurers on April 8 for the account holders and at the same time informed them that we were travelling to Australia from August 31 to October 24 and paid a supplement to cover 60 days' absence from the UK.

I cannot see how Santander can cancel the holiday insurance on a fixed future date and then wash their hands of the consequences.

FR, Cambs

Free benefits from banks like the ones these two readers are writing about seem to be falling by the wayside as victims of cost cutting.

Along with these, other pluses in banking that people have taken for granted are being whittled down; for example, cashiers who know customers by name.

Branches and agencies are closing. Choices generally seem to be diminishing. Allowing less variation in the products provided will presumably save on staff training.

For staff this may make their work duller while for customers such changes, including what may sometimes appear to be random discrimination against them personally, often causes great inconvenience as well as disgruntlement.

PT had benefited from a historic arrangement that closed to new customers in 2005.

At one stage, PT called what was then Lloyds TSB which said that she should not have been sent the letter she is writing about and the fee she had the issue over would be waived.

However, when PT received her bank statement, the account fee had been charged after all. When she complained she was told it wasn't going to be waived and she had been misinformed by the person who had told her it would be. PT was reimbursed for that month and also given £15 for goodwill.

Then, canvassing her friends with similar circumstances, PT found they were not being charged, while she was.

I couldn't find a reason why PT's fee waiver had been removed and her friends' hadn't been.

Lloyds TSB, as it was then, said: "There were numerous different selection criteria which were assessed before the decision was made."

For TP it will now be a matter of costing up the various components of the benefits, which include travel insurance, mobile phone insurance and AA breakdown cover with roadside assistance, and seeing if she can buy them for less in another way. If she can get them cheaper she should change to an account with no added benefits and no fee.

I understand that for the majority of what were Lloyds TSB AVAs (additional value accounts) customers already pay a monthly fee. For those who still had theirs, if they were part of Project Verde, where customers were automatically moved to TSB, any free waiver there was in place will stay. However, for those who themselves opted to move over to TSB any free fee waiver they had before with Lloyds TSB will go as they will have moved to a new provider.

As for FR and his wife, with little time before they set off on their extended holiday, I contacted Santander as a matter of urgency. It agreed as a gesture of goodwill, to refund pro rata for additional pieces of cover FR had paid the card insurer for, and for insurance for the part of the holiday falling after the October 18 2013 - the cut-off date. FR went on his holiday armed with these assurances knowing he had the cover he and his wife needed in place.

Now, just before the cut-off date, the figures have indeed been finally sorted out.

The cost to Santander of extending the insurance beyond midnight on October 18 2013 is £136.83. It is also defraying the £17.43 cost FR and his wife incurred for extending the trip duration time on the cover and £11.73 for a second medical screening.

Santander undertook that it would do the same for all other customers who had already, by the time the decision was made known, booked holidays starting before October 18 2013 and finishing after this date. The few this affected it assures me have now been offered the additional cover they require in the same way as FR.

Meanwhile, Santander says, "We want to improve service for customers, and to do that we know we have to simplify our product range. Our view is that customers want even better service and a range of products that is easy to understand."

It says it had so many products that staff and customers found it difficult to understand what they were.

Is your bank removing any benefits from your account? Email us at money@telegraph.co.uk